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No brass, no PFI

Simon Targett quotes John McWilliam of Greenwich University as saying that the Committee of Vice Chancellors and Principals is talking nonsense when it says the Private Finance Initiative is not suitable for accommodation (THES, October 4).

What the CVCP actually says is that PFI is unsuitable for many university capital projects where, unlike residential accommodation, there is no associated income stream. University residences have long been built with private money. As you say, the Greenwich scheme did not begin life as a PFI. Many universities find that the PFI is less useful than conventional methods of raising private capital, because universities are unable to reclaim the VAT they must pay on PFI schemes.

Most other capital needs of universities are for things that do not bring in an income stream after completion. Teaching and research equipment would be a good example. The massive capital cut of 30 per cent imposed on English universities in the last Budget has fallen mainly on equipment.

The Greenwich project described in Mr Targett's piece is a clear exception to this general rule.